Q7: LCOE Analysis Your company is evaluating a renewable energy investment proposition. The firm can invest \$146 million now, in year 0, to build a 100MW wind farm. The wind farm will take one year to build, and starting during year 1 you expect it to generate electricity at a capacity factor of 35%. The analysis and discounting calculations should be done on an annual basis due to internal accounting practices. Your company has a real cost of capital of 5%, and they have asked you to conduct the following analyses to help them decide whether to make this investment: a) How much electricity (in MWh ) will the wind farm generate each year? Ignore leap years for this entire exercise. b) What is the levelized cost of electricity if you assume the wind farm will only produce electricity in year 1 ? Do this on paper and show your work. c) What is the levelized cost of electricity if you assume the wind farm will produce electricity for 25 years? Would you recommend that the company make this investment if they can sign a PPA for all the electricity you generate at a price of $35/MWh ? We recommend using computer software (e.g., excel) to do this calculation